May 17, 2022

Financial Results Briefing Session for Fiscal Year Ended March 31, 2022
Q&A (Summary)(Q1) Could you share with us the background of the rise in the LME nickel price andits future outlook?
(A1) Behind the rising LME nickel price, there are causes such as a recovery in demand
resulting from the reopening of economic activities in countries around the world,
rising demand for application for EV batteries and geopolitical risks.
Regarding the outlook for the price down the road, the demand for nickel is likely tofurther rise due to an increase in production of batteries for EVs and the continued
global expansion of production of stainless steel in China and other countries.
Accordingly, we find it difficult to imagine a scenario in which the price will fallsignificantly.
(Q2) Do you think that the formula in which ferronickel selling prices are linked with
the LME nickel price will remain effective? Or will a certain kind of discount be
determined as a result of the gap in demand between Class 1 and Class 2
nickel?
(A2) We are going to maintain the formula that employs LME as the pricing indicator.
Additionally, we have continued to adjust prices in accordance with change indemand for nickel sources for stainless steel, fluctuations of the LME price and thelike.
(Q3) Regarding the new fiscal year plan, could you tell us about the impact of cost
increases including fuel and electricity prices, and key figures as preconditions(crude oil, steam coal, exchange rates, etc.)?
(A3) Currently, various raw material prices have been surging. We incorporated these ascost liabilities under certain premises. Since figures set as preconditions areconnected with sensitive details, we refrain from commenting.

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(Q4) Could you tell us about your decarbonization efforts for ferronickel smelting?
(A4) We are in the middle of drawing up a concrete roadmap to realize net zero CO2emissions in FY2050. At the moment, we are exploring measures and technologies
necessary for this reduction. We will shortlist feasible ideas and incorporate them in
the roadmap by taking into account our GHG emissions, measures and the timing ofadopting technologies.
(Q5) Could you update us on the leak of molten substance from an electric furnace?
That is, the scale of damage, the prospect of restoration and the inclusion of
the necessary costs in the operating results.
(A5) Firstly, with respect to the scale of damage, although the operation of all production
facilities was suspended at one point in time, two electric furnaces out of the total ofthree—one of which had caused the leak—restarted production one week after theaccident, and in this way we have managed to minimize the impact.
In regard to the outlook for the restoration of the electric furnace with the leak, weplan to restart production in the third quarter of the fiscal year ending March 2023
since the deliveries of materials and so on will span an extended period of time due
in part to ongoing supply chain disruptions. Although there will be an impact on
production and sales volumes down the road, we will deal with the situation bymaking up for the shortage with the two operating furnaces and inventory as much aspossible. We are still calculating exactly how much the restoration will cost, but wehave already included the costs that we were able to compute in the plan.

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ending March 2023 and the sensitivity to price fluctuations? In particular,
prices surged toward the end of the fiscal year. So, if profit or loss wasgenerated in an unusual way, could you explain it?
(A6) Regarding the preconditions for the plan, we were considering a medium-termbusiness plan before the invasion of Ukraine. Accordingly, the current situation isdifferent from the environment that we regarded as the premise, as the situation has
deviated from the current market tendency. However, the price has been determinedagainst the background of a variety of impacts during the past few months. Since
there remain a number of unclear points about whether this price level will continue
or not, we have a conservative outlook. Consequently, our plan is based on thepremise that we are in a usual environment. As this matter is sensitive, we will refrainfrom answering since we are practically a single firm.
(Q7) Could you share with us the current geopolitical environment and risks in
China, Russia, Ukraine, Indonesia and other countries?
(A7) Our recognition is that the global environment has changed due to Russia's invasionof Ukraine. At the moment, our procurement of raw materials will not become moredifficult, but the movements of natural resource prices have become more unclear,and there are questions, such as where will countries turn to as the source of theirprocurement? It is extremely difficult to forecast what changes will occur.
Regarding the regional geopolitical risks that the shareholder asked about, werecognize that after the invasion of Ukraine, no special changes have occurred inregions other than ones involved in the invasion. However, going forward, we willclosely watch for risks involved in sales and raw material procurement.

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(Q8) Could you share with us the trends in and competitive landscape of nickel pig
iron (NPI)?
(A8) The global nickel supply and demand situation, which had suffered an oversupply
due to a rapid expansion of NPI production in recent years, has currently shifted toan undersupply. The main reasons are that economic activities in the world arerecovering from the COVID-19 pandemic and returning to normal, and that stainlesssteel production is picking up in Japan and overseas. Accordingly, the LME price ison an upward trend.
While a further NPI production increase in Indonesia is causing signs of softening inthe supply and demand of nickel as a raw material for stainless steel, our ferronickel
products are securing a certain level of demand by leveraging their edge over NPI interms including quality.
(Q9) Could you share with us at which particular point you have placed importanceconcerning the contents of the Medium-term Business Plan?
(A9) We raised issues relating to materials in this Medium-term Business Plan. Just now, I
narrowed them down and outlined priority measures. We consider of all theircontents to be important. However, from the perspective of the destination of funds orinvestments, the key lies in investing in domestic business candidates, and inoverseas business, which are laid out in the Investment Plan on page 24 of Briefing
Material. (Corresponding to " Promotion of overseas smelting projects and start-up
of production" and " Promotion of production and sales of raw materials for LIBmaterials" in Priority Measures on page 20 of the Briefing Material.)(Q10) Various HPAL projects are set to be launched in Southeast Asia. Could you tell
us about how we should interpret their impact on the nickel supply anddemand situation?
(A10) Many of the planned HPAL projects are intended to produce Class 1 nickel for LIBs
and the like. Therefore, we suppose that they will not affect supply and demand fornickel for stainless steel considerably.
Additionally, although we do not think that all of the projects that have beenannounced to date will materialize as planned, we suppose that they will increase
supplies of nickel for LIB applications substantially.

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(Q11) Could you tell us whether you will be able to pass on the rise in raw materialcosts (ore prices, coal, etc.) and logistics costs in your selling prices?
(A11) In the business structure of ferronickel, selling prices and production prices arebasically established by different markets, etc. The business is not structured todirectly and immediately pass the recent surge in raw materials and fuel costs toselling prices. In terms of sales, however, we have established a system that allows
us to have conversations flexibly, including with regard to customers' demands, inaddition to diverse conditions, the supply and demand situation and the like.
(Q12) Regarding page 27 of the Briefing Material, the factors in raw material priceincreases (minus 9.1 billion yen) are bigger than the factors in the LME pricerise (plus 7 billion yen). Could you share that background with us?
(A12) "The LME price, etc." among the factors in ferronickel net sales on page 27 ofBriefing Material is mainly changes in the LME price. "Raw material prices, etc."
among the factors in the cost of ferronickel sales also includes fluctuations in theprices of ore, coal, heavy oil, energy, etc. other than the LME price. While our plan isbased on an LME price that is higher than in the previous term, the ongoing surge inraw material and fuel prices have been factored in.

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(Q13) On page 15 of the Briefing Material, you wrote "Minimize risks." Could you
share with us any specific measures or ideas you may have?
(A13) Regarding "Initiative to minimize risks and exploit opportunities" on page 15 ofBriefing Material, as described on page 20 of Briefing Material, which was explained
previously, competitors' production has become extremely high in Indonesia as aferronickel-related risk. To tackle this, we are considering the possibility of expanding
into overseas smelting in Indonesia, as mentioned in Priority Measures  on page 20of the Briefing Material.
Simultaneously, regarding production in Japan, we plan to use nickel sources for cost
reduction and raise the usage rate of substances other than nickel ores. In respect ofcarbon neutrality, which is often in the headlines, as CO2 emissions are high in theproduction process of ferronickel, particularly when coal is used, we plan to convert
them to forge low-carbon ferronickel products, take that as an opportunity and sell
those products.
Furthermore, sulfurized nickel and sulfurized cobalt are raw materials for the positiveelectrode of lithium-ion batteries (LIB). In order to supply these elements, we havemade progress in R&D and are pushing forward with efforts to commercialize them.
In respect of recycling-related matters as well, we concluded a capital and businessalliance agreement with AMITA HOLDINGS last year, and we hold a monthly council
to come up with and look into several ideas for the creation of new business.
We will take existing risks as opportunities including pending issues from ourprevious Medium-term Business Plan "PAMCO-2021" and solve these issues in our
New Medium-term Business Plan "PAMCO-2024."

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(Q14) According to page 22 of the Briefing Material, sales volume even for the fiscal
year ending March 2025 will be at a level similar to those of the fiscal year
ended March 2022. Is there any scenario or possibility that can have an impact
on market share and competitiveness?
(A14) With respect to our production capacity, production volume itself may be steadilyreaching the limit even when a three-furnace system is in operation as the nickel
grade in ores gradually lowers. Therefore, it will make sense that we will win
customers by supplying products of better quality instead of in greater volumes. Withthe top priority given to supplies for the Japanese market, we will look into buyers bytaking into account the environment surrounding prices and demand. At the moment,
particularly, we are not thinking of a scenario in which production volume areincreased at a stroke in the future.
(Q15) Regarding "Production and sales of raw materials for LIB materials" on page
20 of the Briefing Material, if you have supplementary explanations, such as
the key overview, timeline, partners and an idea of contribution to revenue,
could you share them with us?
(A15) We have drafted various plans and are making preparations for them. However, wewill refrain from divulging details here, in consideration of the circumstances of ourpartner companies. However, we plan to announce such plans one by one, once they
are ready to be publicized.

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